A federal judge in Texas has blocked a U.S. Department of Labor rule extending overtime pay to more than four million U.S. workers through an emergency nationwide injunction that may not permanently block the change but has blocked its mandatory December 1 deadline.
Chicago Business Journal reported that the “Obama-backed rule had been scheduled to take effect Dec. 1, and many employers nationwide had changed the way they pay workers to meet the requirements of the new rule.”
The new rule would more than double the salary threshold for workers to qualify as exempt from overtime pay requirements. The rule would raise that threshold from $455 to $913 per week, or from $23,660 to $47,476 per year and would include a provision that would automatically raise the threshold every three years.
U.S. District Judge Amos Mazzant in Sherman heard arguments in the motion for a preliminary injunction from 21 states and a coalition of business groups who said the rule was unlawful.
The effect of the change reportedly would be that most businesses and many nonprofit organizations would be required to pay time-and-a-half for hours worked over 40 in a week by those workers making $47,476 or less per year.
The ruling, if implemented, has been called “the biggest change in labor and employment law in more than 15 years.”